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|True retirement reform|
Sen. Dan Claitor of Baton Rouge certainly knows how to put his colleagues between a rock and hard place.
That's the polite description of the predicament members of the Senate find themselves in today with debate pending on Senate Bill 727, which would bar former members of the Legislature from participating in the Louisiana State Employees' Retirement System (LASERS). Claitor authored SB 727. A number of senators signed on as co-authors, but for all practical purposes, it's Claitor's bill.
Needless to say, some folks are unhappy with him because of it.
Claitor's SB 727 specifically says, "Any person (former lawmaker) to whom this Act applies who is an active contributing member of the Louisiana State Employees' Retirement System on June 30, 2012, may retain service credit accrued in the system; however, such person shall on and after July 1, 2012, be ineligible to be a member of the system. Employer and employee contributions on the salary of all such persons shall cease, and no further service credit shall accrue after June 30, 2012."
In layman's terms, Claitor's bill would put an end to former lawmakers going to work for the state following their tenures in the Legislature and securing lucrative retirement packages to boot. Bluntly put, it's Claitor's intention to stop lawmakers from "cashing in" on favors they may have accrued while serving in the House or Senate, or both. Landing a high-paying state job following a stint in the Legislature certainly would qualify as "cashing in," especially in light of the lucrative retirement and health insurance benefits that accompany those state jobs.
SB 727 would specifically hit home with any lawmaker who was grandfathered into LASERS when the Legislature altered state law in the mid-1990s to prohibit legislators from participating in LASERS. Noble Ellington of Winnsboro comes of mind.
Ellington served in the Legislature from 1988-2012. He's one of those former lawmakers who was grandfathered into LASERS. Ellington now works for the state Department of Insurance in a job that pays $150,000 annually.
When the time arrives for Ellington to retire, his state retirement income will be based on the three highest years of salary in service to the state. Assuming Ellington works for the Department of Insurance for at least three years at $150,000 per year, his retirement income will be based on the $150,000 per year figure.
Claitor's bill would stop the clock on Ellington's retirement income. In other words, Ellington's retirement income would largely be based on his salary as a member of the Legislature, or some $30,000-plus per year.
Ellington is just one example of how SB 727 would rock the apple cart, as far former lawmakers are concerned. Any discussion about him in this space should not be interpreted as picking on Ellington. Instead, his situation simply gives you an idea of how SB 727 would affect someone you may know personally or may know of him.
It's within reason to assume Claitor's bill – if it becomes law – will be challenged in court. Don't be surprised if a judge – especially a politically connected jurist – declares it unconstitutional.
Why would it be unconstitutional? Because it seems there might be some validity to the argument that the state cannot arbitrarily break an existing contract with a state employee. Make no mistake. Retirement benefits accrued by a state employee based on state law at the time he or she was hired would constitute a contractual agreement.
At least that's how I read it, but I'm not an attorney.
Yet, all of the in and outs of what may be constitutional or unconstitutional are irrelevant.
What's relevant is the Senate must vote on Claitor's SB 727, and that, my friends, is what's called being caught between a rock and hard place. After all, any member of the Legislature who votes "no" on Claitor's bill will have earned a reputation as a lawmaker who opposed true retirement reform.
At the very least, that's how the general public is going to see it.